Lmaster makes high-performance sails for competitive windsurfers. Below is information about the inputs and outputs for one model, the Windy 2000. Units sold 1,231 Sale price each $ 1,710 Total labor hours 46,453 Wage rate $ 13 /hour Total materials $ 60,120 Total energy $ 4,110 Calculate the productivity in sales revenue/labor expense

The productivity in sales revenue/labor expense: 3.49

Explanation:

Total sales (revenue) = Sale price per unit x Units sold = $1,710 x 1,231 = $2,105,010

Total labor expense = Total labor hours x Wage rate = 46,453 x $13 = $603,889

The productivity in sales revenue/labor expense is calculated by ussing following formula:

The productivity in sales revenue/labor expense = Total sales/Total labor expense = $2,105,010/$603,889 = 3.49

That means for every dollar lmaster puts into labor, the company potentially makes $3.49 in sales revenue

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